Taiwan's economy grew at a slower-than-expected rate in the first quarter as lackluster private consumption offset robust exports, a government official said yesterday.
The slight correction would not hinder further economic growth during the rest of the year. Robust exports in the first quarter led the government to raise its gross domestic product (GDP) forecast for the full year to 4.31 percent from the 4.25 percent predicted previously.
"Growth momentum looks quite good for the year as the global economy is moving up which includes Taiwan's major trade partners, the US and China," Hsu Jan-yau (許璋瑤), minister of the Directorate-General of Budget, Accounting and Statistics (DGBAS), told a press conference.
"All the key indicators are moving up except for private consumption," he said.
Nationally, GDP was 4.93 percent during the first quarter, lower than the 5.06 percent estimated in February by the government's statistical agency.
The first-quarter figure of 4.93 percent growth also compares to a 6.4-percent expansion registered during the final quarter of last year, the fastest pace for six quarters, according to DGBAS figures.
"Private consumption is much more sluggish than we expected, primarily because of a sharp drop in automobile sales," Hsu said.
According to statistics compiled by the Ministry of Transportation and Communications, sales of new cars in Taiwan dropped by nearly 25 percent in the first quarter from the same period a year ago.
Private consumption, which makes up about two-thirds of Taiwan's total GDP figure, only increased by 2.07 percent instead of the 2.97 percent projected by the government.
But, the exports of goods and services grew at a faster-than-expected annual rate at 14.1 percent during the first three months, compared to the earlier estimates of 12.1 percent, Hsu said without giving detailed figures.
Manufacturing production, the biggest component of industrial output, also increased rapidly, rising 8.21 percent from a year ago, he said.
But, rocketing crude oil prices and high levels of credit and cash-card debt, which were partly blamed for sluggish personal consumption during the first three months, were concerns, Hsu said.
Cheng Cheng-mount (鄭貞茂), an economist at Citigroup, said he was inclined to keep his forecast unchanged.
"We haven't seen sufficient evidence to lift the forecast," Cheng said.
Cheng predicted that Taiwan's economy would expand by 3.9 percent this year from last year.
"Inflation is the only uncertainty and can erode economic growth," Cheng said.
The government predicted the consumer price index, a tool used to gauge an economy's inflation, would rise moderately by 1.8 percent this year after increasing by 1.35 percent in the January-March period from the same period last year.
Hsu said growth in the CPI would only take away about 0.1 percentage point from the nation's GDP this year as the hikes in energy and electricity prices did not reflect sky-high global oil prices.
Intel Corp chief executive officer Lip-Bu Tan (陳立武) is expected to meet with Taiwanese suppliers next month in conjunction with the opening of the Computex Taipei trade show, supply chain sources said on Monday. The visit, the first for Tan to Taiwan since assuming his new post last month, would be aimed at enhancing Intel’s ties with suppliers in Taiwan as he attempts to help turn around the struggling US chipmaker, the sources said. Tan is to hold a banquet to celebrate Intel’s 40-year presence in Taiwan before Computex opens on May 20 and invite dozens of Taiwanese suppliers to exchange views
Application-specific integrated circuit designer Faraday Technology Corp (智原) yesterday said that although revenue this quarter would decline 30 percent from last quarter, it retained its full-year forecast of revenue growth of 100 percent. The company attributed the quarterly drop to a slowdown in customers’ production of chips using Faraday’s advanced packaging technology. The company is still confident about its revenue growth this year, given its strong “design-win” — or the projects it won to help customers design their chips, Faraday president Steve Wang (王國雍) told an online earnings conference. “The design-win this year is better than we expected. We believe we will win
Chizuko Kimura has become the first female sushi chef in the world to win a Michelin star, fulfilling a promise she made to her dying husband to continue his legacy. The 54-year-old Japanese chef regained the Michelin star her late husband, Shunei Kimura, won three years ago for their Sushi Shunei restaurant in Paris. For Shunei Kimura, the star was a dream come true. However, the joy was short-lived. He died from cancer just three months later in June 2022. He was 65. The following year, the restaurant in the heart of Montmartre lost its star rating. Chizuko Kimura insisted that the new star is still down
While China’s leaders use their economic and political might to fight US President Donald Trump’s trade war “to the end,” its army of social media soldiers are embarking on a more humorous campaign online. Trump’s tariff blitz has seen Washington and Beijing impose eye-watering duties on imports from the other, fanning a standoff between the economic superpowers that has sparked global recession fears and sent markets into a tailspin. Trump says his policy is a response to years of being “ripped off” by other countries and aims to bring manufacturing to the US, forcing companies to employ US workers. However, China’s online warriors